(CNN) -- Although more U.S. troops have died in 2007 than any year since the war began in 2003, the U.S. military says the monthly tolls are declining, buttressing its claim of progress in the war effort.

U.S. soldiers in Baquba, Iraq, salute during a service Wednesday for comrades killed by a suicide bomber.

Thirty-seven troops have died in November and 38 troops died in October. If the November number stands -- and more fatality reports could trickle in over the next couple of days -- the two-month toll of 74 will be the lowest since 2004, when 20 died in February and 52 in March.

U.S. fatalities for all of 2007 are 878, the worst year since the war began in March 2003. But the Pentagon says the monthly numbers reflect in part the effect of the "surge" -- the addition of 30,000 troops in and around Baghdad starting in midsummer.

The year started with 83 deaths in January and 81 in both February and March. The numbers jumped dramatically in the spring, to 104 in April, 126 in May and 101 in June. Those three months were the deadliest three-month stretch for U.S. troops in the war.

As the military established its new strategy, insurgent attacks killed 78 U.S. troops in July, 84 in August, 65 in September, 38 in October and 36 so far in November.

Authorities said the results of the surge are decreases in sectarian violence, drops in attacks and military and civilian casualties, and a belief among some Iraqi refugees who fled the war-torn country that returning home is an option because of increased security.

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"We're in a definite period of progress," Brig. Gen. Ed Cardon, deputy commander for support, Multi-National Division-Central, said Monday.

Military officials like Cardon are quick to warn that conditions are still perilous and the effort to establish stability in the country continues.

"Everything's not 100 percent," Cardon said, noting recent attacks in Baghdad. "But it's all moving in the right direction."

"What makes this so important -- this time so important -- this definite period of progress, is that when the violence is down we can do a lot more working with governance and economic development and economic reconstruction," Cardon said. "And that's really going to be the focus of our efforts over the next several months without taking our eye off the security advances that we've made."E-mail to a friend